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Supreme Court Quashes ₹5 Lakh FDA Compensation Order
After a food-poisoning complaint, food safety officers inspected a dairy and sweets shop in Pune.
They reported problems with hygiene, records, labels and employees’ personal hygiene.
A sample of Malai Pedha was later found unsafe, and the shop’s food licence was suspended.
The shop challenged the action and gave the authorities a report saying it had addressed the concerns.
The FDA reinspected the shop four days later.
The Bombay High Court later ordered the FDA to pay the shop ₹5 lakh for alleged business losses.
Maharashtra’s government challenged that compensation order.
The Supreme Court set it aside, saying the FDA’s action was taken under food-safety law and in the interest of public health.
The Supreme Court set aside a Bombay High Court order requiring Maharashtra’s Food and Drug Administration to pay ₹5 lakh to Gurunanak Dairy & Sweets.
FDA officers inspected the Pune establishment on June 12, 2026, after a food-poisoning complaint and found several food-safety deficiencies.
A sample of Malai Pedha was declared unsafe, and the establishment’s food licence was suspended.
The proprietor appealed on June 15 and submitted a compliance report on July 9; the FDA reinspected the premises on July 13.
The State argued the FDA acted under the Food Safety and Standards Act and without malice; the Supreme Court accepted its submissions and quashed the compensation direction.
- Who
- The Supreme Court of India, Maharashtra’s Food and Drug Administration, and M/s Gurunanak Dairy & Sweets.
- What
- The Supreme Court set aside a Bombay High Court direction requiring the FDA to pay ₹5 lakh compensation to the establishment.
- Where
- Pune, Maharashtra, with the case heard by the Bombay High Court and Supreme Court of India.
- When
- The inspection took place on June 12, 2026; the High Court issued its order on August 17, 2026; the Supreme Court set aside the compensation direction on October 5, 2026.
- Why
- The State argued the FDA acted under food-safety law after identifying deficiencies and an unsafe food sample, without malice or deliberate delay.
Maharashtra government
Establishment and High Court order
Whether compensation was justified
Maharashtra government
The State argued the FDA acted lawfully on the basis of food-safety deficiencies and an unsafe sample, and that there was no evidence of malice, arbitrariness or deliberate delay to justify compensation.
Establishment and High Court order
The Bombay High Court revoked the licence suspension and directed ₹5 lakh compensation for business losses allegedly suffered by the establishment.
Time taken in the statutory process
Maharashtra government
The State said time taken in good faith during the statutory process could not, by itself, justify imposing compensation, and noted that the FDA reinspected the premises four days after receiving the compliance report.
Establishment and High Court order
The High Court’s compensation direction treated the establishment’s alleged business losses as warranting payment; the proprietor had challenged the FDA action and submitted a compliance report.
Key facts
- Establishment
- M/s Gurunanak Dairy & Sweets
- Inspection date
- June 12, 2026
- Inspection trigger
- A food-poisoning complaint
- Sample
- Malai Pedha, reported as unsafe
- Statute cited
- Food Safety and Standards Act, 2006
- High Court order
- On August 17, 2026, the Bombay High Court revoked the licence suspension and directed the FDA to pay ₹5 lakh compensation.
- Supreme Court outcome
- The compensation direction was set aside on October 5, 2026.
Sources
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